Paul Hargreaves: NISA Annual Show

16 Apr 2018 08:55:49

Last week I was at the NISA Annual Show in Stoneleigh with the highlight being the Gala Dinner. No-one quite does a Gala Dinner like NISA! With around 900 people being transported into an Arabian Nights type setting, it was a truly spectacular event with belly dancers, whirling dervishes and the room decorated fantastically well. This may be the last evening of its kind, I guess. I am not the Coop would put on such a lavish event, but I may be proved wrong.

The Coop/NISA merger has not officially gone ahead yet, but no doubt it will be approved over the next few weeks just as the Booker/Tesco deal was last year. With the Bestway/Conviviality deal also just gone through (a less planned one, of course) it set me wondering whether there is going to be any more consolidation amongst the smaller wholesalers in the speciality food world. Gleaning what I can from the now-free Companies House data, most of the larger wholesalers within the sector are losing money, hand-over-fist, generally through working on margins that are completely unsustainable.

For the smaller ones, who do not have to publish full accounts, you can only analyse the assets and liabilities and draw some less accurate conclusions. However, from what my sales team report, many of these too are operating on margins and minimum orders that is a race to the bottom, and I would be very surprised indeed if there was not one of two going the same way as Conviviality went at the end of March. There seems to be a complete obsession by some of them to win business at all costs even if it means making a loss. For retailers this can be a great short-term benefit of very low prices, but for the brands themselves this can be damaging as it devalues their proposition as a premium product. It is, of course, illegal to set selling prices of your customers, whether wholesale or retail, but surely better for you to be with a company that is going to still be trading into 2019 and will enhance your brand rather than devaluing it.

Hopefully see some of you at the show this week – I will be on our stand D78 some of the time and on stage for the rest of the time.